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Shares of mid- and small-cap companies were the hardest hit in the last two months, since the market started falling from its peak in January. The mid and small-caps have fallen 50.58 per cent and 69.34 per cent respectively from their all-time highs in January.

The benchmark index, Sensex, has fallen 32.75 per cent from its peak. The Sensex touched an all-time high of 21206.77 on January 10 and on Friday it closed at 15975.52.

Bull rally

"When the markets are getting corrected, people sell their holding in the small- and mid-cap space as they feel that the larger stocks have more value in them and offload small-cap stocks initially. This is one of the reasons why there is always a correction gap of 15 per cent to 20 per cent between the frontline and smaller stocks. Also, when the markets start rallying, there will be buying in the large caps first followed by mid-cap and small-cap stocks," said an analyst.

profit-booking

Among the sectoral indices, realty was among the worst performer as the index crashed 44 per cent from its peak.Capital goods and power too performed poorly by 50 per centand 56 per cent respectively.

Ms Anita Gandhi, Head Institutional Business, Arihant Capital Markets Ltd, says that there is a lot of profit-booking taking place in this sector as the stocks have enjoyed high valuations, when the market was in its bullish phase.

"Till recently, the small cap stocks were the hardest hit, but now big players such as Reliance Energy and even Tata Power have come under heavy selling pressure," said a sub-broker with a brokerage.

Bankex index

The Bankex index, which has been in the spotlight lately due to the Budget announcement on the loan waiver, has dipped 49 per cent as of today from its all-time high hit on January 12. Analysts attribute this dip to the farm loan waiver, which has created a lot of uncertainty in this sector.

"The margins of the PSU banks will be affected negatively due to the waiver of the farm loans. Another reason why the banking sector has tanked so much is because of their exposure to overseas markets. The internationals markets are also going through a lot of uncertainty, this will again affect the margins our banks," said Mr Prashant Bhansali, Director, Mehta Equities Ltd.

A bright spot in the market, though, seems to come from the health care and FMCG sectors.

"These sectors have been underperforming even when the markets were going through the bull rally. Now, there seems to be some investor interest in these counters as the Budget announcements were positive for them.

The FMCG sector in particular, as the Budget was very consumption oriented. Thanks to the Budget, people will have more money at their disposal," said Mr Bhansali. The pharma sector was down 17 per cent as of today from its high, which it hit on January 2. The FMCG sector fell by 16 per cent from its all-time high, which it reached on January 8.